Nagpur: Even though Nagpur Municipal Corporation succeeded in ending the strike by the three Red bus operators, and the contractors’ sit-in protest, by releasing part payments and assurances, the civic body is facing over Rs360 crore debt burden, and appears to be at a loss in finding ways out of this by increasing revenues.
The actual outstanding amount of the civic body is more, as the accounts and finance section has received bills of around Rs260 crore only, with another Rs100 crore dues towards pension and provident fund of employees. Sources in accounts department said bills of many works are still pending with various departments, including public works, health and workshop departments. If all the dues are taken into consideration, NMC’s liabilities might cross Rs500 crore.
The main source of income for NMC is the tax collected from property owners in the city, other than minor sources like rent revenue from shops in market areas, from which it has managed to generate Rs138 crore in this financial year. NMC heaved a sigh of relief when it got the Goods and Services Tax grant of over Rs260 crore in the current fiscal.
However, NMC could only manage to pay a chunk of its committed expenditure of Rs95 crore with the GST grant.
“Though NMC succeeded in ending the bus operators strike and contractors agitation by assuring to clear their dues by the end of this month, it will not be an easy task for the civic body to overcome this crisis,” admitted a source in the accounts department.
NMC officials admit that the civic body is cash-strapped and is finding it tough to make payments to project contractors on time. Unable to clear dues, the civic body is depriving more than 25 lakh residents of various facilities.
It is hampering important works to be performed by the civic body pertaining to sanitation, waste management, malaria and dengue control, and health care. Many contractors entrusted to carry out works of laying sewer lines have not even started the work due to pending payments, claimed Nagpur Municipal Corporation Contractors’ Welfare Association (NMCCWA) president Vijay Nayudu. He said the contractors will intensify their agitation if the civic body fails to clear dues within a month.
Noting that there was a dire need to increase revenue, the civic administration had attempted many times to improve financial condition by introducing many revenue oriented reforms like levying charges for collecting door-to-door garbage, pay and park schemes, and increase in bus fares etc. The proposals, however, were rejected by the ruling BJP at NMC. The opposition Congress too has said it will oppose any attempt to ‘further burden the people of Nagpur’.
Though standing committee chairman Virendra Kukreja was not available for comments, leaders of the ruling BJP feel that instead of increasing tax, NMC should focus on widening the tax base. “A lakh properties in the city are outside the tax ambit. Only five lakh are paying tax to us. We should try to bring more properties under the tax net,” said chairman of tax consultative committee and former standing committee chairman Sandeep Jadhav.
“There are a lakh new properties which have already been identified and it will definitely increase the property tax revenue for the civic body. We can get Rs300 crore if these properties are targeted,” said Jadhav.
To overcome mounting liabilities, some senior ruling party corporators have also approached the state government and urged it to provide some financial grants. “We hope the government acts fast since every passing day is leading to increase in liabilities,” said a senior corporator.
